As a Californian and a solar professional I’ve seen a decent increase in both residential and commercial solar electric installations. In fact, the state trails only Japan and Germany for the amount of photovoltaic (PV) systems in service worldwide.
To be sure, this hasn’t happened just because people think PV is cool and good for the environment. PV systems are still rather expensive and demand for them is usually tied to the high cost of electricity to the consumer. High power costs coupled with financial incentives can make PV systems make sense.
Perhaps the best direct source for potential solar and wind incentives is the Database of State Incentives for Renewables & Efficiency at www.dsireusa.org. The site opens to a map of the U.S. and you can simply click on your state to find out what incentives are available in your state and, in some cases, your own hometown. Federal incentives are also listed.
Types of incentives range from actual rebates, various tax credits, renewable energy credits and even some specific credits from your own utility. Be sure to study now rebates or tax credits apply. For instance, some tax credits can only be taken on the balance of a PV system cost AFTER deducting the rebate. Although DSIRE is regularly updated check your state’s utility regulator (like the Public Utilities Commission in California) and also your own utility for rebates. You might not find incentives for solar or wind but you could get some cash for installing energy-efficient windows, retrofitting your lights and increasing insulation in your house or business.
As of this writing the Energy Policy Act of 2005 gives a federal tax credit for solar and wind installations to both residential and commercial PV buyers. The residential solar tax credit is 30% of system cost capped at $2000. Commercial PV installations get a 30% tax credit with no cap. Both are in effect through December 31, 2008. Currently there is a bill before Congress to increase the residential tax credit to $1000 for every half-kilowatt (500 watts) installed. PV home systems in California average around 5kW/DC (about 4.5kW/AC) so the tax credit could be sizable. The chance of this bill passing is uncertain; a lesser bill never came to a vote last year.
In very general terms the 5kW system just mentioned produces around 700 kW hours per month in most of California (as much as 25% less outside the Sunbelt). This is based on about 5.5 daily hours of power-producing sunlight year-round. The system will avoid about four tons of greenhouse gases annually by not using conventional (coal or natural gas burning) electrical generation. Nuclear power is “clean” but safety of operation and the waste problem continue to be crucial issues.